Diwali Warrants These 4 Insurance Covers. Take A Look.
Diwali is a time for celebrations, meeting and greeting, indulging oneself, and enjoying fireworks in the company of our loved ones. But these festivities also bring plenty of hazards.
With widespread use of firecrackers, lamps, and lights, there are fire and electrical hazards all around us during Diwali. It’s important to take safety measures such as having a fire extinguisher close by to prevent a fire from spreading, and water supply and first aid to quickly treat burns.
It’s also advisable to procure insurance products that would minimize your losses should your damages – to home, vehicle, or person – be extensive. Let’s take a look at some must-have insurance covers that will serve you well not just during Diwali but through the year.
Home Insurance
Home insurance can cover you not just against structural damage to your property but also your home’s contents. You don’t need to own a home to insure it. You can buy insurance even if you live in a rented accommodation. If your property is in a housing society, your society could buy a group insurance plan to cover all houses under its ambit. Fire damage, the gravest Diwali threat, is covered by all home insurance products. A typical basic cover protects you against fire, storms, earthquakes, lightning strikes, and landslides. The cover could be extended to include man-made causes of damage, such as terrorism, riots, aircraft implosion, etc. Natural wear and tear, damage during war or invasion of a foreign force, negligence, etc. would not be covered. To shortlist an insurance product best suited to you, you must go online to compare various options before shortlisting the one best matching your risk profile.
Comprehensive Auto Insurance
Just as your home and property could be damaged by fire, so could your vehicles. It’s important to have comprehensive vehicle insurance as opposed to a third party cover which, while mandatory by law, merely covers damage or injury caused by the policy holder to another person or property. A comprehensive cover, on the other hand, covers damages and losses caused in circumstances other than road accidents. These circumstances could be theft, vandalism, damage to glass, floods, fire, storms, as well as damage to third party. Vehicle owners who park in uncovered and unsecured spaces are at risk during Diwali, and it would be wise for them to get a comprehensive cover. Not only would it see them through Diwali, it would keep them covered through the year.
Gold Insurance
Diwali is the time Indians prefer to buy gold. They pray to Lakshmi, the goddess of wealth, and it’s not unusual for them to hold their valuables at home during Diwali. Holding valuables at home brings the risk of theft. You have two options to protect yourself from theft of your valuables. One – you can go for a home insurance that also protects your home’s contents. Your valuables such as gold and jewellery would be covered up to a sub-limit within the total home cover. For example, if your home content risk is covered for Rs. 10 lakh and you have a sub-limit of 25% for gold and jewellery, you will recover up to Rs. 2.5 lakh from a claim for that particular item. However, such a cover may require your precious items to be either worn or be under lock as suggested by your policy. Two – you could get a standalone cover for your precious items. It’s usual for connoisseurs to insure valuables such as art. Gold and jewellery could be similarly covered. Under a standalone policy, losses from a wider range of incidents can be covered than home insurance. Like other insurance products, gold insurance will not cover wilful damage, or damage from natural wear and tear, war, riots, etc. Also, the insurer will not take into account any appreciation in the market value of the gold and settle claims based on the sum agreed upon in the policy.
Health Insurance
This should be a no-brainer. On Diwali, thousands of people get burn injuries. A fraction of these injuries turn critical or fatal. Severe burns would require extensive hospitalisation and treatment. Children are particularly at risk here, since they play with firecrackers a lot more than adults. But ill fortune could befall anyone, no matter how old and wise they are. Make sure you have all members of your family covered under a health plan. A typical medi-claim policy from your employer would cover you and your dependents. But it’s advisable to buy a retail policy -- personal or family floater plan – that you could continue independent of your employment status. A family floater plan can help bring down your premium costs. If you’re a 35-year-old married male with one minor child, you could obtain a floater cover of Rs. 500,000 for an annual premium ranging around Rs. 11,000. This is not an optional cover, but an absolute must-have that would protect you from massive hospitalisation expenses—not just the ones that could arise out of a Diwali accident, but for any medical emergency through the rest of the year.
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(A version of this article appeared in Finapolis. Picture via Siddharthav/Flickr under CC BY 2.0.)